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Will Domino’s Pizza Enterprises Ltd. (ASX:DMP) be next to issue a profit downgrade?

Investors may question if Domino’s Pizza Enterprises Ltd. (ASX: DMP) will get a big a boost in sales from the FIFA World Cup following some press reports today.

If investors are nervous, they aren’t showing it with the stock running 1.7% higher in morning trade to $53.96 even as the Australian Financial Review quoted comments from Domino’s marketing director for France.

The executive was interviewed by French daily Le Figaro and she said that the latest match between France and Australia had not delivered quite as big a kick as other World Cup matches in the past.

This is because the timing of the match was in the afternoon in France while consumers tend to order pizza deliveries in the evening.

The AFR is pouring water on the notion that the global sporting event will lead to a spike in orders for the ASX-listed Domino’s, which owns stores in a number of EU countries like France and Germany.

A number of brokers have highlighted this potential catalyst and shareholders will need all the good news they can get to overcome persistent worries that Domino’s will miss its relatively ambitious net profit target of around 20% and same store sales growth of 6%-8%.

But one match don’t maketh the Cup! While the AFR may be right about the timing of the match where the French team beat the Socceroos, most of the other matches played by the French and German teams are in the evening in the eurozone – at least from what I can see from the FIFA match schedule.

This is probably why Domino’s share price is continuing to climb since hitting a two-and-a-half year low in April.

There’s still room for the fast food group to climb too as its one-year share price performance lags the broader market with the stock down 1%, when the S&P/ASX 200 (Index:^AXJO) (ASX:XJO) is up 10% as the index hit a fresh 10-year high thanks to the outperformance of advertising company APN Outdoor Group Ltd (ASX: APO), residential community developer Gateway Lifestyle Group (ASX: GTY) and milk formula maker Bellamy s Australia Ltd (ASX: BAL).

However, it’s still a little early to say if Domino’s can meet its guidance but one would have thought that it will have to provide an update reasonably soon given that we are in the midst of the so-called “confession season”, as listed companies square their books for the year and are obliged to issue updates if earnings change materially (usually defined as 15% or more).

We are already getting a number of confessions coming through with telco Telstra Corporation Ltd (ASX: TLS) downgrading its profit yesterday and Ramsay Health Care Limited Fully Paid Ord. Shrs (ASX: RHC) doing the dirty today.

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Motley Fool contributor Brendon Lau owns shares of Telstra Limited. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia has recommended Domino's Pizza Enterprises Limited and Ramsay Health Care Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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